Manchester City has initiated new legal proceedings against the Premier League, challenging recently amended rules governing sponsorship deals with associated parties. The Premier League champions claim these regulations are "void" and unlawful.
In a letter to clubs obtained by BBC Sport, Premier League chief executive Richard Masters confirmed that Manchester City began the arbitration process on January 20, 2025. The challenge specifically targets amendments to the Associated Party Transaction (APT) regulations that were approved during a shareholders' meeting in November 2024.
The APT rules were designed to prevent clubs from benefiting from commercial arrangements with owner-linked companies that exceed fair market value. While a majority of top-flight clubs voted to approve the amendments last November, City, along with Newcastle, Nottingham Forest, and Aston Villa, opposed the changes.
This latest legal challenge follows a previous victory for Manchester City when an independent arbitration panel found certain aspects of the league's APT regulations to be unlawful. The tribunal specifically ruled that low-interest shareholder loans should not be excluded from the APT scope, and attempts to strengthen the regulations breached competition law.
At the time, City criticized the Premier League's "misleading" suggestion that the regulations could be quickly amended, warning against any "knee-jerk reaction." The club argued that proposed changes would introduce retrospective exemptions for shareholder loans - precisely what was deemed illegal in the recent arbitration.
The Premier League maintains its position, with Masters stating in his letter that the league "remains strongly of the view that the amendments passed in November were lawful and the APT rules comply with all competition law requirements." He emphasized that the APT rules remain in full force, and clubs must continue to comply with all aspects of the system.
This dispute represents the latest chapter in an ongoing legal battle that has already resulted in substantial legal fees for both parties. Adding to the complexity, City is simultaneously awaiting the outcome of a separate disciplinary hearing regarding more than 100 alleged breaches of financial rules, which the club denies.
The timing is particularly significant as top-flight clubs prepare for their first shareholder meeting of 2025 in London. Both Manchester City and the Premier League have declined to comment on this latest development.
The same tribunal that handled the previous case will oversee this new arbitration, with both parties agreeing that the matter requires swift resolution. A two-day hearing was already held last week for submissions regarding the impact of the original ruling, with the panel currently in deliberation.
